Every morning that we get up arguably the first thing we check up on is the score of our favorite team. Whichever sport that fascinates us is routinely checked upon. Cricket, football, tennis, badminton pages / columns on the sports page are keenly read. Many people (including myself) begin reading the daily newspaper starting from the sports page. Our mood swings for the next hour is often linked to team status and the score card that is in front of us.
Invariably during the day and for many wanting to catch up on the global stock markets at night – we view and analyze the world around us thru numbers. Exchange rates, Stock indices, Commodity prices, Gold rates, Realty index, Sports performance score cards and the dreaded Inflation index.
For all of us who constantly seek some kind of inner satisfaction by analyzing numbers it is indeed ironical that when it comes to looking at our organization, our daily, weekly, monthly and quarterly performances we put on our “Subjective glasses”.
The metric driven objective based methods of analyzing and reporting performance in an easy to use and comprehend manner is simply lacking at most place.
A Balanced Scorecard defines what management means by “performance” and measures whether management is achieving desired results. The Balanced Scorecard translates Mission and Vision Statements into a comprehensive set of objectives and performance measures that can be quantified and appraised. These measures typically include the following categories of performance:
Financial performance (revenues, earnings, return on capital, cash flow)
Customer value performance (market share, customer satisfaction measures, customer loyalty)
Internal business process performance (productivity rates, quality measures, timeliness)
Innovation performance (percent of revenue from new products, employee suggestions, rate of improvement index)
Employee performance (morale, knowledge, turnover, use of best demonstrated practices)
Usage and effectiveness among survey respondents
What Balanced Scorecards do?
Articulate the business’s vision and strategy
Identify the performance categories that best link the business’s vision and strategy to its results (e.g., financial performance, operations, innovation, employee performance)
Establish objectives that support the business’s vision and strategy
Develop effective measures and meaningful standards, establishing both short-term milestones and long-term targets
Ensure company wide acceptance of the measures
Create appropriate budgeting, tracking, communication, and reward systems
Collect and analyze performance data and compare actual results with desired performance
Take action to close unfavorable gaps
The Idea Smith has relevant expertise, competence in developing and implementing “Balance Score card” for your industry.
What gets measured! Gets Improved!
To know more about how The Idea Smith lean principles and PDCA methodology can help your company improve profitability by reducing lead times, costs and wastes while increasing throughput and customer satisfaction , get in touch .